New Notification Obligation For Czech Energy Sector Transactions

Effective 1 January 2024, the Czech Energy Act (No. 458/2000 Coll.; "EA") mandates notification to the Ministry of Industry and Trade for both direct and indirect acquisitions of elements of energy critical infrastructure. The parties will be under a standstill obligation until the transaction is cleared. Notably, the triggering event is set to 10 % of shares or voting rights or even lower. Let's take a closer look at the new transaction review feature.

What targets?

The EA imposes a notification obligation on transactions relating to elements of critical infrastructure in the energy sector, namely in the area of electricity, natural gas or central distribution of heat. Infrastructure is designated an element of critical infrastructure by the decision of a government authority. In general, it only covers businesses that have a significant impact on Czech energy infrastructure.